Federal auditor to probe Cape Breton yacht deal

NDP MP Ryan Cleary(right), Tom Mulcair (left) head of the federal NDP and leader of the Official Opposition of Canada. Cleary wrote a letter to the federal auditor general to look at funding decisions made by Enterprise Cape Breton Corporation. (Ryan Cleary's offical NDP website)

New Democrat MP Ryan Cleary wrote to the auditor general's office last month, asking that he review ECBC's funding for a marina and a yacht club.

Cleary represents the Newfoundland and Labrador district of St. John's South-Mount Pearl, he's also parliamentary critic for the Atlantic Canada Opportunities Agency.

ECBC is funding $4 million of the $4.8 million marina at Ben Eoin.

It also said it plans to spend close to $280,000 to buy the Royal Cape Breton Yacht Club building and then demolish it.

Cleary questions the rationale behind both decisions, saying there was little public consultation and there appears to be little economic return.

In a written response, Ferguson said his office is doing its yearly audit of ECBC and will examine some of the aspects that Cleary raised.

Michael Ferguson is the federal auditor general. (Canadian Press)

Cleary said he's encouraged by that response.

"I raised issues that the people brought to me, so the fact that the auditor general of Canada now is going to investigate, is fabulous. It shows that our democracy is working," he said.

"He also noted, to quote from his letter, that it's helpful for us to know about issues that concern you as parliamentarians, and then he said he appreciated us taking the time to inform them, I find that encouraging as well."

ECBC's spending sparked outcry from the community as people demanded to know why the historic Cape Breton Yacht Club would be destroyed while a new marina would be built just 20 kilometres away.

Cleary said people in Cape Breton were telling him the transactions need scrutiny.

"Concerns were raised about why there's been so little private investment in the project, and questions were also raised about potential conflict of interest involving decision makers at the ECBC," he said.

"I wasn't any more specific than that, I left it at that, so those basically were the concerns that I raised in my letter, and then again, he wrote back to say that he's going to examine some aspects of transactions, relating to issues that I raised," said Cleary.

The auditor general did not indicate when he'll be finished his audit of ECBC's spending but said his report will be included in the corporation's 2013 financial statements.